Poughkeepsie remains in fiscal stress; Comptroller warns of recession

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POUGHKEEPSIE – A report released by State Comptroller Tom DiNapoli on the City of Poughkeepsie’s finances as of December 2021 says the city remains in “significant financial stress.”

DiNapoli also warned of a possible recession when releasing the report of 20 municipalities in some form of fiscal stress.

Poughkeepsie had the same “significant fiscal stress” designation at the end of 2020, according to DiNapoli.  In the Hudson Valley, the Dutchess County Village of Wappingers Falls and the Westchester County Village of Pelham have been ranked as “susceptible to fiscal stress.”

“The infusion of aid from the federal government and robust local sales tax revenues helped to put local governments on solid fiscal ground in 2021,” DiNapoli said while noting, “Inflation remains a major concern and sales tax growth is slowing in many areas. The comptroller also warned of further fiscal stressors. “With the end of extraordinary federal aid, and a possible recession looming, local governments need to plan carefully to avoid fiscal cliffs in the future.”

Poughkeepsie City Administrator Marc Nelson noted that the city’s general fund deficit was $13.2 million when Rob Rolison took over as mayor.  “Over the following five years the deficit has been reduced to approximately $2.8 million.”  Nelson indicated that the multi-million-dollar deficit reduction was aided by “sharply curtailed borrowing practices” instituted when Mayor Rolison took office.   “The city has kept taxes below the state’s tax cap for five straight years,” he added.

The administration prior to Rolison’s had completely depleted the fund balance.  The city administrator embraced the report as a tool for future assistance.  “The city appreciates the comptroller’s use of this benchmarking system because it demonstrates our need relative to our sister cities.”

Explaining the comptroller’s ratings to Mid-Hudson News previously, Nelson said, “The comptroller’s fiscal stress rating is calculated by use of a complex formula which applies a weighting system to a number of categories. The most heavily weighted component of the scoring system is the reserve, or fund balance, that a municipality has on hand for use in times of need.”